Reality check for apples

Orange orchardist and Nuffield Scholar Fiona Hall among Pink Lady apples ready for harvest at Bonny Glen Fruits. She predicts future consolidation of the industry with new exports and value-adding opportunities at the forefront.

AUSTRALIAN apple growing families need to take a leaf or two from their New Zealand counterparts who have advanced their industry 20 years ahead.

Growers over the “ditch” are now regarded as the “millionaire club”, while the Australian industry is heading for a world of pain, according to Orange orchardist, Fiona Hall, who used her 2015 Nuffield Scholarship to identify best practice from other countries to map out how these could address the pressing issues for the Australian industry, particularly family-owned apple production.

Managing director of Caernarvon Cherry Company, a holistic growing, packing and marketing operation, Mrs Hall is also co-owner of Bonny Glen Fruits, growing apples on four properties, plus two cold storage properties packing market apples for themselves and other growers under their “Biteriot” brand.

“New Zealand went through some big consolidation and there were big changes for them, and the same is destined for Australian families if we don’t start looking to the future and plan accordingly,” she said.

“The apple industry is never going to die, but it is going to contract while finding more opportunities to sustain long-term survival.

“Apples are our main game, but we are over producing and consumers are getting a bad eating experience, and consequently, less apples are being eaten.

“Over production means we’ve got last year’s fruit still coming onto the market when our new Galas are coming in.

“We are not seasonal enough.”

Mrs Hall said people were buying Pink Ladies in February thinking that was the new season because that’s how they are advertised, but in actual fact it’s not.

“The new Gala season is there, but consumers are eating old produce, and that’s because we are not moving through the stock quickly enough.”

She said there was far too much produce and not enough exporting to ease the pressure on the domestic market.

“We are relying too much on the domestic market and we are not ensuring a good eating product.”

Mrs Hall said supermarkets have a stranglehold, taking upwards of 70 to 80 per cent of local supply.

“And there’s only so much shelf-space for so many varieties.

“So we have to make sure we are growing that variety the supermarkets are going to sell.

“Their profit margins have increased so they have a big stronghold and that’s another reason why we should not be so reliant on them.”

Mrs Hall said opportunities for survival were increasing exports and finding value-adding opportunities that would give a decent return back to growers to entice them not to put inferior fruit onto the market.

“We need some research and development money thrown into what other value-adding opportunities there could be,” she said.

“We import a lot of juice and that’s a challenge for us, but there’s got to be other ways of keeping that inferior fruit off the market.”

While Mrs Hall suggests growers could look at not growing that inferior fruit, there was always hail damage or climate-affected fruit.

“Most growers are trying to overcome much of this by putting in hail netting and other measures, but there’s always going to be a grade of fruit that doesn’t meet the right size,” she said.

“So growers have to be taking more of a stance on ensuring they are only growing the best quality they can, then improving their packouts and varieties – have the right variety mix.”

The industry really has to look at itself, that’s why Mrs Hall believes growers are about to go through a further consolidation.

“Market forces create the consolidation and the contraction of the industry,” she said. In the meantime, Mrs Hall said the industry needed to find niche markets with the varieties particularly grown for the Asian palate.

“We need to be riding on the tails of our ‘clean and green’ image and can’t compete in the commodity space with bulk produce from China and the United States.

“We have to try and find the ideal customers and markets that we can go in with that niche product.”

Mrs Hall said if the industry gained a “few more percent” of market share, it would be an overall benefit to all Australian growers.

Outbound investment from Australia is currently $540 billion a year and the top three recipients are the US, UK and New Zealand.

“However, the amount that flows to China and India combined only accounts for about 2.9 per cent of that $540b,” she said.

“Australia needs to focus on emerging markets in China and India.”

To advance, Mrs Hall said growers should look more at benchmarking, then be able to create investment into the industry.

“But we don’t have the business figures.

“How do we compare apples to another asset class in horticulture?”

Mrs Hall said the industry needs that sort of information for an investor to be able to compare.

“An analyst in Sydney is not able to make any recommendations to an investor group if we don’t give the figures and we can’t get the figures if we don’t have the right mindset to share information.

“We must change our Australian mindset and not be reluctant to create a culture of information sharing to stay in this industry.”